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EXHIBIT 12
RELIANT ENERGY, INCORPORATED AND SUBSIDIARIES
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(THOUSANDS OF DOLLARS)
THREE
MONTHS ENDED TWELVE MONTHS
MARCH 31, ENDED MARCH 31,
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1999 1999
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Fixed Charges as Defined:
(1) Interest on Long-Term Debt........................................ $ 103,854 $ 413,963
(2) Other Interest.................................................... 23,339 96,747
(3) Capitalized Interest.............................................. 779 8,170
(4) Distribution on Trust Securities.................................. 9,791 31,582
(5) Interest Component of Rentals Charged to Operating Expense........ 2,600 11,085
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(6) Total Fixed Charges............................................... $ 140,363 $ 561,547
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Earnings as Defined:
(7) Income (loss) from Continuing Operations.......................... $ (209,789) $ (321,156)
(8) Income Taxes for Continuing Operations............................ (56,543) (91,251)
(9) Fixed Charges (line 6)............................................ 140,363 561,547
(10) Capitalized Interest.............................................. (779) (8,170)
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(11) Income from Continuing Operations Before Income Taxes and Fixed
Charges......................................................... (126,748) 140,970
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Ratio of Earnings to Fixed Charges (line 11 divided by line 6)............. 0.25
Preferred Dividends Requirements:
(12) Preferred Stock Dividends......................................... $ 97 $ 390
(13) Less Tax Deduction for Preferred Dividends........................ $ 27 $ 54
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(14) Total............................................................. $ 70 $ 336
(15) Ratio of Pre-Tax Income from Continuing Operations to Net Income
(line 7 plus line 8 divided by line 7).......................... 1.27 1.28
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(16) Line 14 times line 15............................................. 89 430
(17) Add Back Tax Deduction (line 13).................................. 27 54
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(18) Preferred Dividends Factor........................................ 116 484
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(19) Total Fixed Charges (line 6)...................................... $ 140,363 $ 561,547
(20) Preferred Dividends Factor (line 18)............................. 116 484
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(21) Total............................................................. 140,479 562,031
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Ratios of Earnings to Fixed Charges and Preferred Dividends (line 11
divided by line 21)...................................................... 0.25
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Earnings for the three months ended March 31, 1999 are inadequate to cover
fixed charges; the coverage deficiency is approximately $267 million for the
three-month period ended March 31, 1999 and $421 million for the twelve-month
period ended March 31, 1999. The deficiency results from the non-cash,
unrealized accounting loss recorded for the ACES of $331 million for the three
months ended March 31, 1999 and $1,318 million for the twelve months ended March
31, 1999. Excluding ACES, earnings from continuing operations to fixed charges
would have been 1.46 and 2.60 for the three months and twelve months ended March
31, 1999.